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Common Contractor Mortgage Questions

Being a contractor can bring an element of complexity to getting a mortgage for a property.

Which is why it’s really important to work with mortgage brokers who have an expertise in this sector, so they can guide and advise you of your best options.

We hope some of these common contractor mortgage questions help you out.

Do you have a question about a contractor mortgage?

If you have a question about a contractor mortgage that is not covered here, please contact us.

How much can I borrow as a contractor?

To give you a guide some lenders will work off your day rate and multiply this by 46. In other words to work out how much you can borrow: Day rate x 46 = your borrowing amount. Of course this doesn’t take into account, whether you have debts, dependants or a second applicant. All of these things can have an impact. The amount that you can borrow will vary from lender to lender. You will be surprised how much it can vary, often it is thousands, if not tens of thousands. Other factors which can affect how much you can borrow as a contractor include how they choose to asses you. In other words, the way a lender chooses to assess your income and circumstances, can make a huge difference in the overall borrowing amount. This includes factors such as; the type of contract you have, how long you’ve been a contractor, how long you have left on the contract, who pays your tax and much more! Potentially it can be easy to evidence your income but the evidence required will come down to all of the factors above: You might just need a copy of your contract. You might just need your latest payslip. Or you might need your latest 2 years accounts. Of course every lender is different not just in terms of rates, but in terms of how the assess your circumstances. Working with mortgage brokers who are experienced in helping contractors can really help as it is not always straight forward.

Who are the best contractor mortgage lenders?

Trust me there is no simple answer! Lenders change their interest rates, lending rules, and to be honest their service standards do go up and down depending on their staffing and work load. It is never going to be possible to simply say, Halifax, Natwest or whoever! There you go…there is a few, but noting you wouldn’t find using the oracle that is Google! Whats more important is whether they will lend to you and how much they will lend. Don’t forget the lender are all very different! What you will never know is what a good mortgage broker knows. Don’t forget we are working with these lenders day in and day out. We have our finger on the pulse of the mortgage market, just like you probbaly know your sector brilliantly. We know what their latest lending criteria is, their interest rates and importantly what they are like at any moment in time. Equally, becuase your circumstances will be different to someone elses, the best contract mortgage lender could be very different for you compared to someone else. So just becuase your contractor buddy got a halifax mortgage, doesn’t mean halifax is also the best thing for you! Getting independent mortgage advice if you are a contractor by someone who has experience in this sector will really help make sure you get the best contractor mortgage available. It really is as simple as that!

Are interest rates different for contractors?

Contractor mortgages are not priced any differently to any other type of mortgage. In other words the pricing and interest rates will be the same whether you are emplioyed, self employed or a contractor. As a contractor, the difference is in only the way that they will assess you and your income to establish how much they are willing to lend.

Contractor Mortgages Calculators

Contractor Mortgages Borrowing Calculator

Contractor Mortgages Repayment Calculator

We’re completely independent. So we can access the whole market

We’re best positioned to get you the best mortgage deal. Because we’re independent, we’re not tied to just one lender, ensuring our customers get the best possible deal.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.Barr Financial is a trading name of Benjamin Parry who is authorised and regulated by the Financial Conduct Authority. Our FCA Number is 506976. The FCA does not regulate some investment mortgage contracts. Barr Financial are also members of the NACFB (National Association of Commercial Finance Brokers). The Commercial Mortgage Sector is currently a non-regulated activity, as defined by the FCA. Therefore client protection is limited. The only recognised body is the National Association of Commercial Finance Brokers. The NACFB has established complaints and disciplinary procedures designed to eliminate unacceptable working practices amongst its members and Barr Financial subscribe to their standards.